FTC Files Joint Amicus Brief with U.S. Department of Justice in Supreme Court Cases Involving Visa and MasterCard

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The Federal Trade Commission has joined the U.S. Department of Justice’s Antitrust Division in an amicus brief filed by the Solicitor General in the cases of Visa Inc., et al. v. Osborn and Visa Inc., et al. v. Stoumbos, Nos. 15-961 and 15-962, pending before the U.S. Supreme Court.

The amicus brief urges the Court to affirm the U.S. Court of Appeals for the District of Columbia Circuit, which held that the plaintiffs’ complaints adequately alleged an agreement among Visa and MasterCard’s member banks and reversed a district court ruling holding otherwise.

The cases concern rules that Visa and MasterCard adopted when they were owned and operated as joint ventures of retail banks. The question is whether three putative class-action complaints stated a claim of concerted action under Section 1 of the Sherman Act by alleging that the Visa and MasterCard rules govern ATM fees that their member banks charge in their separate businesses as ATM operators.

The Visa and MasterCard rules in question prohibit ATM operators, including banks, from offering discounted ATM access fees to consumers who use debit cards linked to certain networks (such as STAR and NYCE) that are cheaper to use than the competing Visa and MasterCard networks.  Under the Supreme Court’s 2010 decision in American Needle, Inc. v. National Football League, a Section 1 contract, combination, or conspiracy must be (a) an agreement (b) between two or more entities capable of engaging in concerted action. The United States’ amicus brief argues that the allegations in plaintiffs’ complaints satisfy both of those requirements because the access fee rules are written rules adopted by associations of competitors to govern the prices charged in the competitors’ separate businesses.

The FTC vote approving the amicus brief filing was 3-0. It was filed with the U.S. Supreme Court on October 24, 2016. (FTC File No P082105; the staff contact is Bradley Grossman, Office of the General Counsel, 202-326-2994.)

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